This dissertation examines how social interactions, institutions, and public policy shape young people’s preferences and decisions, using experimental and quasi-experimental methods across diverse settings.

Distinct group identities can create barriers to trade, investment in public goods, and social learning—barriers that educational institutions may help overcome. The first two chapters use lab-in-the-field experiments to understand the costs and benefits of group integration. The first paper studies how integration impacts productivity and cohesion in settings with broad linguistic diversity, where language differences may deepen the divides created by group identities. We randomly assign high school students to same- or different-ethnicity partners to play a cooperative video game in Macedonia, where students are segregated by ethnicity. We measure productivity using video game scores and assess social cohesion with two measures: the willingness to pay for a same-ethnicity partner (via an adaptive choice experiment) and ingroup bias (via a dictator game). We find that inter-ethnic contact improves social cohesion without affecting productivity. To examine the role of language, we exploit random variation in the language skills overlap within pairs. We find that shared language skills are associated with greater inter-ethnic cohesion gains and lower non-pecuniary costs. These results reflect both a match effect (i.e., sharing a language is beneficial) and a correlation between language skills and positive potential outcomes. Additionally, cross-ethnic pairs either match on one partner’s home language or on a third, neutral language. Cohesion gains are largest when the shared language is the participant's own home language; if anything, matching on a neutral language yields lower gains than matching on the partner’s home language.

The second paper asks how segregation influences social learning. On one hand, if one group has information that is beneficial to another, segregation may harm learning by preventing information flow. On the other hand, if individuals learn better from in-group members, segregation may increase learning. We formalize this tradeoff with a theoretical model and design a network-based social learning game to test how integration and segregation affect learning under different conditions. We have students in multi-ethnic Macedonian high schools play the game in groups of 6 and find two results that support the theory. First, we find that when a larger proportion of players exhibit bias, the potential learning loss from segregation is smaller. In low-bias groups, students learn more in the integrated networks than in the segregated networks, avoiding echo chambers, but the same is not true in the high-bias groups. Second, integration leads to more learning than segregation in games in which one ethnicity gets mostly incorrect signals and the other ethnicity gets mostly correct signals. Finally, we fit our model to the experimental data and find that, on average, students downweigh information from different-ethnicity players 45 percent more than same-ethnicity players.

In the final paper, we shift focus to U.S. federal financial aid policy to study one of the largest-scale and most consequential policies determining whether students maintain access to Title IV aid, the ``Return of Title IV'' funds policy, referred to as R2T4. Students receiving Title IV aid who withdraw from college before completing the academic term are subject to an R2T4 calculation that could require the student or college to pay back any unearned Title IV funds to the federal government. We estimate the causal impacts of the R2T4 policy using a regression discontinuity design. The identification leverages a cutoff in the federal formula that determines whether a student or their college must return aid. We find that students at our threshold, who earn 60 percent of the federal aid to which they were entitled, must return \$1,600 on average. This unexpected debt reduces the likelihood of re-enrollment by nearly four percentage points compared to students who narrowly avoid the repayment threshold in the following year and by 2.6 percentage points within 4 years. These results are driven by students in the bottom half of the sample’s income distribution, who experience persistent enrollment declines of roughly 5.5 percentage points. Our findings add to a growing body of literature revealing the detrimental impacts of complex administrative processes on student outcomes, particularly for students from marginalized communities interacting with federal policies.